What Happens If a Merchant Does Not Respond to a Dispute?

When a consumer initiates a dispute regarding a transaction, such as for an unauthorized charge or unreceived goods, a common concern arises about the merchant’s role. Many individuals wonder what happens if the merchant does not respond to the claims. Understanding the procedural outcomes provides clarity and insight into consumer protection mechanisms for financial transactions. This process ensures fairness and resolution even when one party remains unresponsive.

Automatic Resolution in Your Favor

In most common consumer dispute scenarios, particularly those involving credit card chargebacks, if a merchant fails to respond within the allotted time, the dispute is typically resolved in favor of the consumer. This outcome means that any provisional credit initially issued to the consumer becomes permanent, and the disputed amount is fully returned to their account. Provisional credit is a temporary credit a bank provides to an account while a transaction is being investigated.

This mechanism exists because major card networks, such as Visa, Mastercard, American Express, and Discover, have established rules requiring merchants to present evidence to contest a chargeback. A lack of response from the merchant is generally treated as an admission of fault or an inability to dispute the claim effectively. Therefore, if a merchant does not provide a rebuttal package or compelling evidence by the deadline, they often lose the chargeback dispute by default. This resolution is a standard procedural outcome of the dispute process, safeguarding consumers when merchants do not engage.

Understanding the Timeline

The resolution of a dispute is not instantaneous; financial institutions and card networks operate within specific timeframes for merchant responses. After a consumer files a dispute, their bank or credit card issuer must first submit the dispute to the merchant’s bank. Only after this initial communication does the merchant receive a set period to respond to the claim.

The general ranges for these response periods vary depending on the card network and the specific phase of the chargeback process. For instance, merchants typically have around 20 days to respond to Visa, American Express, or Discover card chargebacks. For Mastercard chargebacks, merchants are generally given a longer period, often around 45 days per phase. While card networks set these guidelines, the merchant’s acquiring bank or payment processor may impose shorter internal deadlines to ensure they can meet the official network deadlines. The “non-response” is only confirmed after this specific timeframe has fully elapsed without the merchant providing the required documentation or evidence.

Confirming the Outcome and Next Steps

Once the merchant’s response window has closed, the consumer should proactively monitor their bank or credit card statements. The primary goal is to confirm that the provisional credit, applied at the start of the dispute process, has been made permanent. Provisional credit becomes permanent if the bank’s investigation concludes an error occurred or if the merchant fails to meet regulatory deadlines.

If the credit has not been made permanent after the expected timeline, the consumer should promptly follow up with their financial institution. When contacting them, have specific information ready to facilitate the inquiry. This includes the dispute case number, the date the dispute was initially filed, and any relevant transaction details such as the amount and date of the payment. The financial institution remains the primary point of contact for updates and final resolution.